Keystone State Gov. Edward Rendell has signed 2 bills of interest to life insurers.
One of the bills, H.B. 801, will cut the state’s life insurance valuation fee, or tax, to $1 per $100,000 of coverage, from the current rate of $1.50 per $100,000.
The state increased the valuation fee during the 2003-2004 budget cycle, in an effort to increase revenue.
The higher valuation fee “has not brought in the revenue the administration expected, namely because a few life insurance companies have ‘redomesticated,’ or moved their main businesses, out-of-state,” according to an analysis by state Sen. Joe Conti, R-Doylestown, Pa. “Tax policy should encourage businesses to locate here, not penalize them from doing so.”
Rendell, a Democrat, also has signed S.B. 1043, which authorizes the state to pay for the maximum amount of life insurance coverage available to members of the Pennsylvania National Guard through the federal Servicemembers’ Group Life Insurance program.